Multiple Choice
Suppose Stan holds a portfolio consisting of a $10,000 investment in each of 8 different common stocks. The portfolio's beta is 1.25. Now suppose Stan decided to sell one of his stocks that has a beta of 1.00 and to use the proceeds to buy a replacement stock with a beta of 1.35. What would the portfolio's new beta be?
A) 1.17
B) 1.23
C) 1.29
D) 1.36
Correct Answer:
Verified
Correct Answer:
Verified
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